Market regulation between economic and ecological values: Regulatory authorities and dilemmas of responsiveness

AuthorTobias Besselink,Kutsal Yesilkagit
Date01 July 2021
Publication Date01 July 2021
SubjectSpecial Issue Articles
Special Issue: Agencies
Market regulation
between economic
and ecological values:
Regulatory authorities
and dilemmas of
Tobias Besselink and Kutsal Yesilkagit
Institute of Public Administration, Faculty of Governance and
Global Affairs, Leiden University, The Netherlands
The regulation of markets emerged as one of the core pillars of government policies
during the 1990s. However, the ascendance of ecological values and issues, such as
sustainability and security in the following decades challenge some of the basic tenets of
the underlying neo-liberal ideas. We argue in this paper that market and competition
regulators have come under pressures to uphold the market and economic values of the
prevailing anti-trust policies while being responsive to societal pressures that cherish
non-economic values. Competition authorities find themselves locked-in to economic
theories of regulation and find little room for engaging with ecological issues. We
illustrate this with the case of the Dutch competition authority’s approach to managing
the balance between economic and sustainability and animal welfare values.
Bureaucratic responsiveness, competition authorities, ecological regulation, regulatory
‘There will be a better chicken, for all our customers!’, Dutch supermarkets pro-
claimed in an advertisement early 2013. There, farmers’ organizations and repre-
sentatives of the Dutch retail industry kicked-off their campaign in favour of
Public Policy and Administration
2021, Vol. 36(3) 304–322
!The Author(s) 2019
Article reuse guidelines:
DOI: 10.1177/0952076719827630
Corresponding author:
Kutsal Yesilkagit, Institute of Public Administration, Faculty of Governance and Global Affairs, Leiden
University, Turfmarkt 99, 2511 DP Den Haag, The Netherlands.
animal-friendly and sustainably bred chicken meat. Shortly before, the food indus-
try had finally given in to the fierce naming-and-shaming campaigns of animal
protection organizations against the bio-industry. The ‘Chicken of Tomorrow’
would have more space and sleep and ‘behave more naturally as a chicken’. In a
similar vein, in September 2013, more than 40 governmental and private sector
parties signed the Energy Agreement. The parties committed themselves to invest in
the development of renewable energy sources and a substantial reduction of CO
emissions by 2050. The parties also promised economic growth and the creation of
tens of thousands of new jobs for the coming decades. The centrepiece of the
agreement was the closing down of five coal-fired electricity plants (Sociaal
Economische Raad (SER), 2013). To the parties’ and public’s bitter surprise, how-
ever, both agreements were bluntly rejected by the Netherlands Authority for
Consumers and Market (ACM), the Dutch competition authority. ACM declared
both agreements in violation with competition law and a distortion of the market.
The decisions contributed to the reputation of ACM as an overtly technocratic
authority with no empathy towards ecological goals.
Both cases represent a recurring problem in regulatory studies: the goals of
competition policy stand in the way of attaining sustainability goals. Regulatory
goals are often disparate and the logic of market regulation conflicts with envir-
onmental, health, occupational and safety goals. The conflicts are basically about
what constitutes ‘the good society’ (Haines and Gurney, 2013). What is more, the
resolution of such fundamental conflicts has become more and more the responsi-
bility of independent regulatory authorities. They became main sites where ultimate
judgements on fundamental value conflicts are made. Moreover, we could say that
with the spread and establishment of regulatory authorities since the 1990s
(Jordana et al., 2011), we have arrived at a point where some of the most funda-
mental value conflicts in our societies are being decided by non-elected officials
(Vibert, 2007).
While the delegation of authoritative decision making is delegated to these
authorities, they are not well equipped to adequately resolve the above-described
value conflicts. Regulators have a too narrow scope and mandate to balance eco-
nomic versus non-economic values (Hyman and Kovacic, 2013; Jordana and Levi-
Faur, 2010). As Parker and Hains (2018) argue, ‘instrumental rational regulation’
fails to acknowledge that the ‘economy’ is actually embedded in the broader ecol-
ogy. Instrumental regulation ‘privileges piecemeal instrumental thinking to address
particular externalities ðyet systematically ignores cumulative, interrelated sys-
temic problems’ (Parker and Hains, 2018: 143). As long as economic rationality
is the dominant regulatory paradigm value conflicts will be treated as a form of
market externality (Parker and Haines, 2018). The chances that the economist
paradigm changes at the short term are slim. Established in the (early) heydays
of neo-liberal theories (1980s–1990s), regulatory institutions are locked-in to the
logic of capitalist economic thinking and will seemingly remain so in the foresee-
able future (Levi-Faur, 2005).
Besselink and Yesilkagit 305

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